Disneyland Paris’ financial news – in normal people terms!

As you may have seen in our recent post about today’s Disneyland Paris financial news, there has been a big financial shake-up at Euro Disney. If you want the official and numerical garble, then check out the link in the last sentence, but I want to tackle to question of what this news today really means to us guests – without any numbers!

In short: today Disneyland Paris (or Euro Disney S.C.A. to be precise, as they’re the administrative company running Disneyland Paris) was given a heck load of money by The Walt Disney Company, who owns most of Euro Disney anyway. That’s right, The Walt Disney Company is only a PART owner of Disneyland Paris… Confusing, right?

However there is a catch to this massive wad of money which Euro Disney are going to get: it’s not all going to get invested into the ‘guest experience’. Why? Well, for the very reason why this whole financial deal is happening in the first place. That’s because Disneyland Paris is in a very poor financial state, and they’ve only just got around to really admitting that today (although it was pretty poorly kept secret).

Disneyland Paris’ financial state is so bad because it’s heavily in debt and running profits are slipping downwards year-on-year. Oh, and I mean heavily, and partly to the wrong people. These wrong people aren’t the mafia though, thankfully it’s just the French banks. The other part of the debt is to The Walt Disney Company itself, and it’s much better to be in debt to them because they aren’t trying to make a profit from the interest on the loans they give, whereas the French banks (or any banks actually) are. With that in mind, that big chunk of money we mentioned which isn’t go to ‘guest experience’ will go to paying off the debts to the French banks. This leaves Disneyland Paris still heavily in debt, but to The Walt Disney Company only. This is a very good thing, because The Walt Disney Company has a vested interest in Disneyland Paris succeeding in the long term, so won’t be stingy about asking for interest payments if it would come at the expense of that magical term: guest experience.

OK, so that’s where most of the money is going. So how much money is left for investing in the Parks and Hotels? Not a huge amount, but a pretty substantial sum none the less! With the amount of money Disneyland Paris will be getting for investment in guest experience, it looks like they will have enough money to spend on the ambitious plans which are rumoured for the 25th birthday celebrations. And this is very good news!

Before we get carried away, I should explain here that this is all just a proposal and it hasn’t actually been agreed yet. However, this has been proposed jointly by Euro Disney S.C.A. and The Walt Disney Company, so it is very very very unlikely that it will get rejected.

So, to round this all up: Disneyland Paris has been loaned loads of money by a friendly lender. Most of that money will go to paying off older loans to less friendly lenders, but some of it will be available for investment in the good stuff – our beloved Disneyland Paris guest experience! This is good news!